Link co. purchased machinery that cost $3,000,000 on january 4, 2016. the entire cost was recorded as an expense. the machinery has a nine-year life and a $200,000 residual value. the error was discovered on december 20, 2018. ignore income tax considerations. before the correction was made, and before the books were closed on december 31, 2018, retained earnings was understated by: a. $2,333,333. b. $2,066,667. c. $3,000,000. d. $2,377,778.

Fanning company is considering the addition of a new product to its cosmetics line. the company has three distinctly different options: a skin cream, a bath oil, or a hair coloring gel. relevant information and budgeted annual income statements for each of the products follow. skin cream bath oil color gel budgeted sales in units (a) 110,000 190,000 70,000 expected sales price (b) $8 $4 $11 variable costs per unit (c) $2 $2 $7 income statements sales revenue (a × b) $880,000 $760,000 $770,000 variable costs (a × c) (220,000) (380,000) (490,000) contribution margin 660,000 380,000 280,000 fixed costs (432,000) (240,000) (76,000) net income $228,000 $140,000 $204,000 required: (a) determine the margin of safety as a percentage for each product. (b) prepare revised income statements for each product, assuming a 20 percent increase in the budgeted sales volume. (c) for each product, determine the percentage change in net income that results from the 20 percent increase in sales. (d) assuming that management is pessimistic and risk averse, which product should the company add to its cosmetics line? (e) assuming that management is optimistic and risk aggressive, which product should the company add to its cosmetics line?

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If a government accumulates chronic budget deficits over time, what's one possible result? a. a collective action problem b. a debt crisis c. regulatory capture d. an unfunded liability